Critical path method -- The New look in planning and scheduling;

Page 1

The Critical Path Method— The New Look in Planning and Scheduling
by JOHN W. NIXON Consultant, Management Advisory Services, Miami Office
Presented before the Jacksonville Chapter of the National Office Managers Association—April 1964
THE PRESSURE of increased competition in recent years has forced many companies to turn away from the old "seat of the pants" type of man­agement
and turn instead to more formal methods of running their busi­nesses.
This trend toward a more scientific management has brought about the development of a number of significant new management techniques.
This evening's discussion concerns one of the most successful of these techniques: the use of the network models for the planning, scheduling, and control of various projects. The purpose is to present the elements of network analysis technique and the basis for questions in the discussion period to follow.
Most of you must have read of the success the Navy had in producing its Polaris missile years ahead of schedule. In 1956 the Navy was faced with the immense task of scheduling and controlling the efforts of over 2,000 contractors and subcontractors engaged in the missile development project. Working with a consulting firm over a period of two years, they de­veloped
a planning technique known as PERT, or Program Evaluation and Review Technique. It is claimed that PERT saved as much as two years in the development of the Polaris missile. Because of this success, most De­partment
of Defense projects are controlled by PERT.
Previous to the time the Navy was developing PERT, E. I. duPont, with help from Remington Rand, developed CPM, or the Critical Path Method. This technique has been used widely in the chemical and construc­tion
industries.
Since the development of these two basic techniques, computer manu­facturers
and others have come out with systems such as PERT/COST, IBM's LESS and MISS-LESS programs and Burroughs' BEST program. Most of these are expansions or modifications of the basic network analysis techniques.
Although on the surface PERT and CPM appear to be different, they are both based on the concept of using a network as a model for an actual project. As time passes, the differences between the two systems have tended to diminish until presently the only basic difference is that PERT uses three estimates of the time required for each activity—a pessimistic
311